Journal of Cleaner Production 18 (2010) 1073e1083

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Journal of Cleaner Production

journal homepage: www.elsevier.com/locate/jclepro

Diversity of eco-innovations: Reections from selected case studiesq

Javier Carrillo-Hermosilla a, *, Pablo del Ro b, Totti Knnl c,1
a

IE Business School, C/Serrano, 105, Madrid 28006, Spain

Institute for Public Goods and Policies (IPP), Consejo Superior de Investigaciones Cientcas (CSIC), C/Albasanz, 26-28, Madrid 28037, Spain
c
Institute for Prospective Technological Studies (JRC-IPTS), European Commission, Edicio Expo, C/Inca Garcilaso, 3, Seville 41092, Spain
b

a r t i c l e i n f o

a b s t r a c t

Article history:
Received 18 March 2009
Received in revised form
4 December 2009
Accepted 9 February 2010
Available online 16 February 2010

An analytical framework is developed in this paper in order to explore the diversity of eco-innovations
according to several key dimensions (design, user, product service and governance). The framework is
used to analyse a set of case studies of eco-innnovation processes. The diversity of the analysed ecoinnovations appears to be considerable; each of them involves different kinds of combinations of
elements pertaining to those dimensions. Albeit the design dimension is decisive to determine the
environmental impacts of the innovation, all dimensions can play a signicant role in the management of
eco-innovation. Our ndings suggest that the capacity of eco-innovations to provide new business
opportunities and contribute to the transformation towards a sustainable society depends on the
interplay of those dimensions and the engagement of key stakeholders in the innovation process.
2010 Elsevier Ltd. All rights reserved.

Keywords:
Eco-innovation
Environmental policy
Case study method

1. Introduction
In recent years, the term eco-innovation has been increasingly
used in environmental management and policy, although in diverse
contexts and with different underlying connotations that may
eventually reduce its practical value. The denitions of ecoinnovation seem to be quite general and, thus, many kinds of
innovation can be dened as eco-innovations. This raises the
important issue of further classifying eco-innovations in order to
better understand their specic characteristics.
Eco-innovations can be a relevant tool for wiring up the innovation system. They may contribute to the renovation of the whole
innovation system, taking into account social, ecological and
economic aspects. The long-term survival of the economic system
depends on its ability to create and maintain sustainable economic
processes, which do not involve short-term value creation at the
expense of long-term wealth. This paper sheds light on the concept
of eco-innovation. By identifying the different dimensions of ecoinnovations, showing their diversity and addressing both their

q Research reported in this paper was partially funded by the Spains Ministry of
Science an Innovation, research grant No. ECO2009-07237- COMPETITIVIDAD Y
SOSTENIBILIDAD A TRAVS DE LA ECO-INNOVACIN: CARACTERIZACIN, BARRERAS, POLTICAS Y ESTRATEGIAS EMPRESARIALES.
* Corresponding author. Fax: 34 91 745 47 69.
E-mail address: Javier.Carrillo@ie.edu (J. Carrillo-Hermosilla).
1
The views expressed in this paper are purely those of the authors and may not
in any circumstances be regarded as stating an ofcial position of the European
Commission.
0959-6526/$ e see front matter 2010 Elsevier Ltd. All rights reserved.
doi:10.1016/j.jclepro.2010.02.014

process and outcome-oriented impacts, we hope to show the

wealth of ways in which eco-innovation processes can trigger
economic and environmental improvements in their different
dimensions.
Accordingly, the paper is organised as follows. The next section
describes our approach to eco-innovation and develops a typology
to classify and characterise eco-innovations along several dimensions in order to clarify their different types and their corresponding roles in the transition towards sustainable development.
Section 3 discusses the methodology and provides a set of detailed
case studies of eco-innovations. The main ndings and implications
of these case studies with respect to the dimensions of ecoinnovation are discussed in section 4. The paper closes with some
concluding remarks.

2. Understanding eco-innovation and its dimensions

Dening eco-innovation is not an easy task although several
attempts have been made in the literature (see Box 1). In general,
these denitions emphasize that eco-innovations reduce the
environmental impact caused by consumption and production
activities, whether the main motivation for their development or
deployment is environmental or not.
Focusing on the actual environmental impact of eco-innovations
rather than on their environmental protection intentionality has its
pros and its cons. A clear drawback is deciding which innovations in
practice actually reduce the environmental impact of products and
production (VINNOVA, 2001). But there are also problems with

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J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

Box 1. Definitions of eco-innovation and sustainable innovation.

 Eco-innovation is any form of innovation aiming at significant and demonstrable progress towards the goal of sustainable
development, through reducing impacts on the environment or achieving a more efficient and responsible use of natural
resources, including energy (European Commission, 2007).
 Environmental innovation is innovation that serves to prevent or reduce anthropogenic burdens on the environment, clean up
damage already caused or diagnose and monitor environmental problems (VINNOVA, 2001)
 Eco-innovation is the creation of novel and competitively priced goods, processes, systems, services, and procedures
designed to satisfy human needs and provide a better quality of life for all, with a life-cycle minimal use of natural resources
(materials including energy, and surface area) per unit output, and a minimal release of toxic substances (Europa INNOVA,
2006).
 Eco-innovation is the process of developing new products, processes or services which provide customer and business
value but significantly decrease environmental impact (Fussler and James, 1996).
 [Eco-innovation is] Innovation which is able to attract green rents on the market (Andersen, 2002).
 Sustainability-driven innovation is the creation of new market space, products and services or processes driven by social,
environmental or sustainability issues (Little, 2005).
 Sustainable innovation as a process where sustainability considerations (environmental, social, financial) are integrated
into company systems from idea generation through to research and development (R&D) and commercialisation. This
applies to products, services and technologies, as well as new business and organisation models (Charter and Clark,
2007).
 Environmental innovations are new and modified processes, equipment, products, techniques and management systems
that avoid or reduce harmful environmental impacts (Kemp and Arundel, 1998; Rennings and Zwick, 2003).
 Eco-innovation is the production, assimilation or exploitation of a product, production process, service or management or
business method that is novel to the organisation (developing or adopting it) and which results, throughout its life cycle, in
a reduction of environmental risk, pollution and other negative impacts of resources use (including energy use) compared to
relevant alternatives (Kemp and Pearson, 2008).
 Eco-innovations are innovation processes toward sustainable development Environmental innovations are . measures
of relevant actors (firms, ., private households), which: (i) develop new ideas, behaviour, products and processes, apply or
introduce them, and (ii) contribute to a reduction of environmental burdens or to ecologically specified sustainability targets
(Rennings, 2000).
 In a broad sense, environmental innovations can be defined as innovations that consist of new or modified processes,
practices, systems and products which benefit the environment and so contribute to environmental sustainability (Oltra and
Saint Jean, 2009).
 Eco-innovations are all measures of relevant actors (firms, politicians, unions, associations, churches, private households)
which develop new ideas, behaviour, products and processes, apply or introduce them and which contribute to a reduction of
environmental burdens or to ecologically specified sustainability targets (Klemmer et al., 1999).
 Technological environmental innovations (TEIs) may help to reduce the quantities of resources and sinks used, be they
measured as specific environmental intensity per unit of output, or as average consumption per capita, or even in absolute
volumes. Overriding priority, however, is given to improving the qualities and to changing the structures of the industrial
metabolism. Rather than doing less of something, TEIs are designed to do it cleaner and better by implementing new
structures rather than trying to increase eco-productivity of a suboptimal structure which has long been in place. TEIs are
about using new and different technologies rather than using old technologies differently. TEIs can be characterised as being
upstream rather than downstream, i.e., upstream in the manufacturing chain or product chain respectively, as well as
upstream in the life cycle of a technology (Huber, 2004).
 Innovation is the implementation of a new or significantly improved product (good or service), or process, a new marketing
method, or a new organisational method in business practices, workplace organisation or external relations (OECD, 2005).
Eco-innovation is generally the same as other types of innovation but with two important distinctions: 1) Eco-innovation
represents innovation that results in a reduction of environmental impact, whether such an effect is intended or not; 2) The
scope of eco-innovation may go beyond the conventional organisational boundaries of the innovating organisation and
involve broader social arrangements that trigger changes in existing socio-cultural norms and institutional structures (OECD,
2009a,b).
 Eco-innovation is the production, assimilation or exploitation of a novelty in products, production processes, services
or in management and business methods, which aims, throughout its lifecycle, to prevent or substantially reduce
environmental risk, pollution and other negative impacts of resource use (including energy) (European Commission,
2008).
 Environmental technologies include all those whose use is less environmentally harmful than relevant alternatives (European
Commission, 2004).
Source: Own elaboration.

a denition that focuses on the intention of the innovators. As

industry moves on from end-of-pipe solutions to integrated technologies and product innovations, the environmental motivation
for the innovation may become entangled with other motivations.
It may also be difcult to establish the relationship between the
dedicated environmental activities of rms and the environmental

performance of industry (op.cit.). In short, it is certainly more

difcult to verify an environmental motivation than an environmental result, although the latter may also prove challenging.
Of course, the above does not rule out the fact that there might
be technologies designed to reduce the environmental impact of
production and consumption activities in addition to technologies

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

that produce environmental gains as a gratis side-effect.2 As

stressed by OECD (OECD, 2009a), eco-innovation may be environmentally motivated, but may also occur as a side-effect of other
goals, such as reducing production costs. Following Kemp and
Foxon (2007), the rst category may be called environmentally
motivated innovations, whereas the second could be called
environmentally benecial normal innovations. Our denition of
eco-innovation encompasses both types of eco-innovations.
In addition to the environmental impact and environmental
motivation aspects, some authors consider that a crucial element of
eco-innovation is its novelty (VINNOVA, 2001; European
Commission, 2008). Others observe that the use of the term innovation as novelty departs from the Oslo Manual (OECD, 2005) about
innovation which states that innovation does not require in-house
investment in creative activities such as R&D, i.e. that rms can
innovate by adopting technology developed by other rms or
organizations, even when it involves technology that has been
around for some time and is not leading edge (Kemp and Foxon,
2007). Similarly to Kemp and Pearson (2008), our notion of ecoinnovation is related to an innovation which is novel to the rm,
i.e., things done in a different way, whether technologically and
organisationally. This denition emphasizes the eco-innovation's
institutional context, through the notion of novelty to a specic
group. As argued by Morand (2008), this is relevant because
innovativeness is highly context-dependent: what is innovative for
a certain group at a certain time in a certain place may be totally
trivial for another group at another time elsewhere.
Eco-innovation is dened in this paper as an innovation that
improves environmental performance (Carrillo-Hermosilla et al.,
2009), in line with the idea that the reduction in environmental
impacts (whether intentional or not) is the main distinguishing
feature of eco-innovation. From the social point of view, it does not
matter very much if the initial motivation for the uptake of ecoinnovation is purely an environmental one. This approach avoids
discussing whether the innovation was initiated/adopted as a result
of environmental motivation (see also VINNOVA, 2001; Kemp and
Foxon, 2007; Berkhout, 2005).
Basically, innovation refers to the change in the way something
is done. Hence, for the purposes of characterising innovation e
including eco-innovation e, addressing change is deemed a useful
starting point (Carrillo-Hermosilla et al., 2009). For the purposes of
this paper, we distinguish between radical and incremental
changes which are brought about by eco-innovation:
- Incremental changes refer to gradual and continuous
competence-enhancing modications that preserve existing
production systems and sustain the existing networks, creating
added value added in the existing system in which innovations
are rooted.
- Radical changes, in contrast, are competence-destroying,
discontinuous changes that seek the replacement of existing
components e or entire systems e and the creation of new
networks, creating value added.
Various terms have been proposed to discern levels of radicalism of innovations. For example, Freeman and Perez (1988)
distinguish between incremental innovations, radical innovations,

2
An example of an environmentally motivated innovation is Carbon Capture
and Storage (CCS), which deals with emissions from fossil-fuel based generation by
storing them underground. Its addition to coal-based generation plants does
neither improve the competitiveness of the adopter nor the efciency of the
process (indeed, it increases its energy consumption, i.e. the so-called energy
penalty). It is only motivated by the implementation of carbon abatement policies.

1075

changes of technology system and changes in technoeconomic

paradigm. The later is similar to a technological revolution whereby
changes go beyond changes in specic products or processes. This
type of pervasive technological change is inuenced by and, in turn,
inuences institutional and social changes. Christensen (1997)
distinguishes between sustaining innovations and disrupting
innovations. The later are those innovations that render obsolete
existing structures and systems. Disruptive products tend to underperform in mainstream markets but have certain features that are
highly valued by specic customers. As a product improves, it
might then break out of its original, small niche and replace the
dominant product, as happened in the case of gas turbines.
This distinction between radical and incremental innovation can
also be related to environmental functions.3 It is increasingly and
generally acknowledged that a focus on incremental innovation
along established paths does not sufce for achieving demanding
environmental sustainability goals such as mitigating climate
change. A need for radical technological change or even system
innovation has often been expressed (e.g. Tukker and Butter, 2007;
Smith et al., 2005; Nill and Kemp, 2009). More systemic changes
generally embody higher potential benets than modication
(OECD, 2009a). More integrated sustainable manufacturing initiatives such as closed-loop production can potentially yield higher
environmental improvements in the medium to long term,
compared to simple modications in processes and products (such
as small, progressive product and process adjustments). For
example, Tukker and Butter (2007) distinguish between system
optimizations, singular innovations and system-level innovations.
The former leads to only a few dozen percentage points of
sustainability improvement. Singular innovations that change
elements of production-consumption chains may lead to
improvements of 50 or 75%, whereas system-level innovations lead
to radical reductions of environmental pressure.4
Our attempt to conceptualise eco-innovation draws on an
evolutionary perspective of innovation (see, e.g., Dosi et al., 1988;
Arthur, 1994; Nelson and Winter, 2002; Witt, 2009), according to
which innovation arises through a systemic process that refers to
the interconnectedness and dynamic interaction between different
actors and internal and external factors inuencing the innovation
process. These premises invite us to explore the wide array of ecoinnovations and to examine the occurred changes in several
dimensions of eco-innovations, which namely consist of the design,
user, product-service and governance aspects (Carrillo-Hermosilla
et al., 2009).

2.1. Design dimensions of eco-innovation

We consider design as a crucial dimension of proactive planning
that addresses both how to improve existing systems and how to
create or transform to an entirely new system. From an environmental perspective, two different design rationales to innovations
can be distinguished: one considers human actions incompatible
with the natural environment and focuses on minimizing those
environmental impacts. The other focuses on redesigning human
made systems to reduce the environmental impacts of production
and consumption activities. When these two perspectives are
combined with the incremental/radical nature of technological
change and the degree of impacts to the system, three different

See also 2.1.

However, it is beyond the scope of this paper to provide a full discussion of this
literature. See (Nill and Kemp, 2009; Van den berg and Kemp, 2008) for further
details.
4

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

ECONOMIC SUSTAINABILITY
OF THE SYSTEM

+
+

POSITIVE
IMPACT
(REDESIGN)
SYSTEM CHANGE
(Eco-effectiveness)

SUB-SYSTEM CHANGE
(Eco-efficiency)

NEGATIVE
IMPACT
MINIMIZATION

ENVIRONMENTAL AND SOCIAL

SUSTAINABILITY

1076

COMPONENT
ADDITION
(End-of-pipe)

INCREMENTAL
CHANGE IN THE SYSTEM

RADICALLY
DIFFERENT SYSTEM

Fig. 1. Typology of eco-innovations according to the radical or incremental nature of produced technological change and the level of impacts to the system (Source: Author's own
gure).

approaches can be proposed to identify the role and impacts of ecoinnovations (Fig. 1).
Component addition (development of additional components to
improve environmental quality, as with end-of-pipe technologies): Component level changes minimize and repair negative
impacts without necessarily changing the process and system that
generate those impacts in the rst place. If the innovation is an
additional component to the system, extra costs to the process are
likely to be incurred. Since the industrial revolution, the implementation of these technologies has led to major improvements in
local air quality and water purication. However, if these technologies do not change the main process, they will only solve part
of the problem.5 Notwithstanding, when existing production
systems cannot be changed quickly enough, this type of ecoinnovation can be a valuable tool for dealing with the problem,
gaining time to have cleaner but currently incipient technologies
to mature.6
Sub-system change (e.g. eco-efcient solutions and optimisation
of sub-systems): They reduce negative impacts by creating more
goods and services while using fewer resources and generating less
waste and pollution. This approach comes down specically to the
term eco-efciency (Schmidheiny, 1992), which envisions the
production of economically-valuable goods and services while
reducing the ecological impacts of production (i.e., producing more
with less). The concept of eco-efciency provides practical, actionoriented guidance on how to combine environmental issues in
business. But its goals, however admirable, are often regarded as

5
For example, catalytic converters reduce the toxicity of emissions (nitrogen
oxides, monoxide, hydrocarbons) from an internal combustion engine, but increase
fuel consumption and carbon dioxide emissions. The catalytic converter is an addon solution adopted instead of a cleaner and more efcient combustion engine
which would offer fuel economy benets as well as lower emissions.
6
For example, carbon capture and storage is an approach to mitigating global
warming by capturing carbon dioxide from large point sources such as fossil fuel
power plants and storing it underground instead of releasing it into the
atmosphere.

insufcient in so far as increases in environmental efciency tend

to be erased by subsequent growth (rebound effect).7
System change (redesign of systems, e.g. towards eco-effective
solutions): Changes in the system and its components and subsystems are designed with a view to reduce the environmental
impacts on the ecosystem and society at large.8 This approach
builds on the analogy between natural and socio-technical systems
traditionally proposed by industrial ecologists (e.g. Frosch and
Gallopoulos, 1989; Socolow, 1997; Ayres and Ayres, 2002; Lifset,
2005; Cohen-Rosenthal, 2004), who focus on the design of industrial systems in order to incorporate principles exhibited within
natural ecosystems and shift from linear (open loop) systems e in
which resources move through the system to become waste e to
closed loop systems in which wastes become inputs for new
processes.
The systemic approach to environmental design leads to two
alternative design perspectives: closed and open cycles (McDonough
and Braungart, 2002; Braungart et al., 2007). The former refers to the
design of the uptake of products back to industrial production
processes at the end of their useful life to produce equally or more
valuable new products. Open cycles refer to the design of products
that are biodegradable and become nutrients to new cycles within
the ecosystem. Moving towards eco-effectiveness is likely to provide
the highest opportunities to improve sustainability, because new
solutions are looked for beyond existing production systems.
Eco-effective system level changes go beyond improvements in
existing activities and challenges companies and society at large to
redene their production and behavioural patterns (see Section 2.4
on the governance of eco-innovation).

7
For example, improvements in combustion engine efciency have led to major
improvements in the fuel consumption of vehicles. However, at the same time, the
number of vehicles and total fuel consumption have continued to increase, along
with their harmful environmental impacts.
8
Note that, although our denition of eco-innovation encompasses ecoinnovations with or without an environmental motivation, the focus on this dimension (design) is mainly on eco-innovations with a dominant environmental
orientation.

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

2.2. User dimensions of eco-innovation

In order to develop eco-innovations, companies should be able
to anticipate the acceptance of eco-innovations in the market. They
should involve users in their development with the aim to benet
from their creativeness to develop new products and services and
to ensure that they will accept and take them up. Indeed, users play
a key role not only in applying innovations but also in identifying,
making improvements and developing new innovations. Some of
these are subsequently adopted by manufacturers and sold as
commercial products. So it may be crucial for companies to know
which users are capable of contributing to the different phases of
the innovation process and how to interact with them. But this
user-producer interactions perspective should be complemented
with the consideration of the inuence of market demand on new
product development, as stressed by Pujari (2006).9
Accordingly, two user dimensions of eco-innovation are worth
considering:
User development: Von Hippel (2005) denes users as rms or
individual consumers that expect to benet from the use of
a product or service, in contrast to manufacturers, who are
expected to benet from selling a product or service.
Empirical studies reveal that some users are very active in the
innovation process as they adopt the roles of inventors and (co)developers (Hienerth et al., 2006). This phenomenon has been
apparent in different areas such as scientic instruments (Riggs and
Von Hippel, 1994), CAD software (Urban and Von Hippel, 1988) and
sporting equipment (Luthje et al., 2005). Although those studies
have shown that many users engage in developing or modifying
products, they also reveal that, when considering the radical nature
of user-driven innovations, the new products have a rather low to
medium degree of innovativeness. This might be explained by the
specic barriers to users in the context of radical innovations.
Cognitive limitations may prevent them from delivering valuable
inputs. In the idea-generation phase, users can be functionally
xed to their current use context and are therefore unable to
develop radically new ideas. It may also be difcult for them to
evaluate concepts and prototypes of radical innovations as no
reference product exists. In addition, they might not be able to
provide valuable inputs due to the high technological complexities
involved. Finally, users are not always willing to contribute to
radical innovation projects. This lack of motivation might be related
to high anticipated switching costs and the fear that the existing
knowledge will become obsolete.
In order to systematically involve users in the innovation
process, rms need a special competence to identify which users
are capable of providing valuable inputs in innovation projects
(Rondinelli and London, 2003). The lead user methodology (Urban
and Von Hippel, 1988) seeks to identify and involve potential users
in the idea generation and development phase. Lead users differ
from ordinary users in that they derive signicant benets if they
nd innovative solutions and, therefore, are highly motivated to
engage in the new product development process.
User Acceptance: As mentioned above, user behaviour plays
a crucial role in the application of eco-innovations and their
resulting impacts on society. In turn, market focus is a key factor
inuencing the market performance of greener products (Pujari,
2006).10 A clear understanding of users' needs and wants is
crucial for successful new products. Establishing specic target

We are indebted to an anonymous referee for these comments.

The other factors are cross-functional coordination between new product
development professionals and environmental specialists, supplier involvement
and life-cycle analysis.
10

1077

Sub-system
System

Component

Governance

User
development

1 2 3 4 5

Product-service
process

User
acceptance
Product-service
deliverable

Fig. 2. Eco-Innovation Dashboard for the assessment of the occurred change in eight
dimensions of eco-innovation (Source: Authors' own gure).

markets for greener products and assessing market needs are

important for market success. This calls for marketing professionals
to provide input about those needs and wants (including environmental ones) at early stages of product development. Nevertheless,
developing a product which excels in environmental terms while
remaining economically and technically competitive is a signicant
challenge (Pujari, 2006, p. 78).
2.3. Product service dimensions in eco-innovation
The generation of eco-innovations largely depends on the
benets received by the innovator. Successful innovations must
provide higher value or reduce costs and, ultimately, either increase
revenues from existing customers or attract new customers. On the
other hand, the way companies create added value with their
products, processes and services can play a crucial role in the
innovation process and its environmental impacts (Stahel and
Jackson, 1993).
To be radical, product service innovation requires a redenition
of the product service concept and how it is provided to customers
(Markides 2006). Mont (2002) and Williams (2007), for instance,
propose the application of a product service system for developing sustainable business models. This refers to a system of
products, services, supporting networks and infrastructure that is
designed to be: competitive, satisfy customer needs and have
a lower environmental impact than traditional business models.
The approach focuses on the delivery of a function to the
customer that might, in practice, mean the provision of combinations of products and services that are capable of jointly fullling
users needs (Goedkoop et al., 1999).
The product service dimension of eco-innovation stresses the
relevance of a supply chain perspective in eco-innovation. It calls
for a shift in the focus from short-sighted local optimisation to the
entire supply chain during the production, consumption, customer
service and post-disposal of products (Linton et al., 2007). In
practice, the relations between different actors creating added
value in products, processes and services can be characterised as
value networks rather than value chains (Knnl and Unruh,
2007). The following two product service dimensions are deemed
crucial in the context of this paper:
Change in product service deliverable consists of identiable
changes in the product/service delivered and changes in the
perception of the customer relation. For instance, Interface Inc.

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J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

transformed its business from selling carpets to offering a service

package including renting carpets and their maintenance.
Change in product service process consists of changes in the
value-networks (value-chain and other relations) and processes
which enable the delivery of the product service. An example of an
eco-innovation in product service process is certied forest
management that commits the whole value chain to implement
sustainable practices.
2.4. Governance dimension of eco-innovation
Eco-innovations, particularly when they are radical and require
techno-institutional system-level changes,11 are difcult to achieve
because the prevailing system may act as a barrier to the creation
and diffusion of a new system.12 Such prevailing lock-in conditions
have been documented in the emergence of numerous technologies, including the automobile, electricity and the personal
computer (Unruh, 2000). If the existing system has become socially
and economically pervasive, or if there are other justications for
its maintenance, such as national security, governments may
encourage its expansion through a variety of mechanisms including
subsidies, incentives or outright ownership (e.g. Unruh, 2000;
Freeman and Perez, 1988).13 Overcoming such lock-in conditions,
which act as a barrier to eco-innovation, may require major
governance innovation both in the private and public sectors.
Innovations in environmental governance refer to all institutional solutions in, both, the private and public sector aimed at
resolving conicts over environmental resources. Institutional
solutions refer to changes in norms and values potentially leading
to new organisational or structural changes in a company,
government or society at large. From the public sector point of view
those solutions can deal with one of the functions of environmental
governance, including: exclusion of unauthorized users, regulation
of authorized resource use and the distribution of the respective
benets (market based instruments), provision and recovery of
costs, monitoring, enforcement, conict resolution, and collective
choice (Paavola, 2007). From the perspective of a company, the
governance dimension invites managers to explore the wider role
of business in society, i.e., to renew their relationships with other
stakeholders, particularly with the government. The term governance pinpoints the importance of public-private collaboration
when addressing eco-innovation.
Radical innovations in governance have emerged, in particular,
where industrial federations and overarching organisations have
been created bottom-up to coordinate the functioning of governance solutions (Ostrom, 1990; Sengupta, 2004). In contrast, topdown processes generate many formal multi-level governance
solutions. Such bottom-up and top-down processes can also come

11
The terms socio-technical systems (Geels, 2002), innovation systems
(Edqvist, 1997), and transition (Rotmans et al., 2001) have also been used to
describe a similar kind of fundamental transformation processes of the coevolution of technological and institutional systems.
12
See e.g. (Carrillo-Hermosilla, 2006; Carrillo-Hermosilla and Unruh, 2006;
Unruh, 2000; Geels, 2002; Jacobsson and Johnson, 2000; Kline, 2001; Carlsson and
Jacobsson, 2004; Frenken et al., 2004; Foxon et al., 2005; Scrase and Mackerron,
2009).
13
The success of an eco-innovation does not only depend on specic instruments
offered by the government and specically targeted at eco-innovations. Indeed, in
addition to environmental and technology policies (see OECD, 2009a), other
broader policies (i.e., macroeconomic, industrial, education and employment policies) also affect, both, the supply and demand of eco-innovations. Furthermore, not
only specic instruments but their design elements and the contextual conditions
(such as the style, stability and exibility of regulation) are relevant in this regard
(see Del Ro, 2009). Finally, in addition to policies inuencing the supply and
demand sides of eco-innovation, the government may act as a matchmaker
between supply and demand (Taylor, 2008).

together, as it is the case in the combination of the global regime to

mitigate climate change and national and regional mitigation
efforts.
We consider that, particularly at the system level, the governance of eco-innovation has a crucial role to play, despite the fact
that transitions towards radically different systems are complex
societal co-evolutionary processes, typically led by a series of
gradual and parallel adaptations rather than visionary management or coordination. Still, visionary coordination of policies,
regulation, corporate strategies and social learning may overcome
some barriers and foster new innovation efforts, providing sufcient impetus towards system transition.14 Here, it is crucial to link
long-term visions with the short and medium term strategies to
generate favourable industrial, policy and social conditions leading
to common action towards the system change.
Expanding on the above discussion, eco-innovations involve
a combination of elements pertaining to the dimensions of design,
product/service business model, user and governance. While the
relative importance of those dimensions varies, eco-innovation e
by denition e should have a positive impact on the environment.
Hence, in so far as the design dimension is decisive to determine
the environmental impacts of the innovation, it is crucial in labelling it eco-innovation.
However, the innovation processes leading to changes in the
design dimension are also likely to emerge from other
eco-innovation dimensions. Therefore, all the dimensions play
a signicant role in understanding the multi-faceted nature of
eco-innovation and the diversity of eco-innovations. When they are
addressed together, they form a comprehensive framework for the
analysis of eco-innovation (Carrillo-Hermosilla et al., 2009).
Once the key dimensions of eco-innovation have been identied
and described, their relative importance in specic eco-innovations
should be assessed. In order to better characterise those
eco-innovations and illustrate our approach, we assess the
dimensions of selected eco-innovations by using a Likert scale with
ve levels of scores, with 1 meaning an incremental change and 5
a radical one (zero represents no change). If the dimensions are
presented together with the scores for evaluating the degree of
change, then it is possible to construct a dashboard to visualise
the characteristics of each eco-innovation (Fig. 2). When an
eco-innovation is assessed in all dimensions using the Likert scale,
the scores can be connected. The resulting area characterises the
specic eco-innovation being assessed (see Section 4).
3. Method and data
There are many ways of eco-innovating. The study of ecoinnovation can benet signicantly from empirical analyses
which grasp the details of specic eco-innovation types and,
particularly, their dimensions. A case study approach is ideal for
generating theoretical and pragmatic insights from empirical
observations when little is known about a phenomenon and when
there is disagreement within the literature (Eisenhardt and
Graebner, 2007). Case studies are able to capture the details of
eco-innovations, which are unnoticed in top-down, aggregate
quantitative analyses. We decided to conduct multiple case studies,
since multiple cases can increase the external validity, and, ultimately, the generalizability, of research ndings (Cook and
Campbell, 1976; Patton, 1990).

14
In this context, ecoinnovation is a response to, both existing and expected
regulations. The anticipation of regulatory trends by rms developing an ecoinnovation might be very relevant in this regard, as shown by Beise and Rennings
(2005).

Table 1
Cross-case comparisons for successful eco-innovations: Dimensions of eco-innovation (Scores e in brackets e reect how radical the change occurred in these dimensions was, 1 being an incremental change and 5 a radical one).
Case

A. Design of component B. Design of sub-system C. Design of system

addition
change
change

D. User development E. User acceptance

G. Change in
product service
process

H. Governance change

(1) The cement industry

relies strongly on the
established Portland
cement manufacturing
technology (dominant
design position). Demand
generation for Ecocement
is the main barrier for its
uptake.

(3) Production of
a new type of
cement and
a solution to
a major waste
disposal problem.
However, the
innovation does
not consist of
service
dimensions.

(4) Compared to
Portland cement,
the new value
chain includes
waste collection
and incineration,
and separation of
incineration
waste.

(4) The Japanese

authorities developed the
technology together with
private companies and
included Ecocement into
the cement standard
specication after
consultation with
stakeholders.

(2) The fast uptake of

EcoWorx in the
commercial building
industry was due to
customers perceiving that
EcoWorx performed well
in terms of its
environmental impact,
functionality and quality.

(4) The redesign

of the product
value chain and
(3) The new
the building up of
product entails
the reverse
radical changes in
logistics system
product/service
are radical
deliverable.
changes in the
product-service
process

Ecocement
(5) Similar
manufacturing process
as ordinary Portland
cement. The incineration
and the use of
incineration ashes in
cement production are
new components in
cement production and
waste management.

(4) It improves
efciency in cement
production and waste
management systems.
It reduces CO2
emissions/tonne
cement, extracts
chlorine and heavy
metals from the process
and recycles them.

(1) Efcient and safe, but

partial, solution for
resource management.
The burning of organic
waste material is
downcycling, because
the waste materials can
not be reused for the
same or better purposes.

(4) Taiheiyo Cement

corporation takes an
active role in the
development of
Ecocement, together
with academia and
the public sector.

EcoWorx, carpet backing

(1) The commercial
(4) Environmental
building industry has
(3) It consists of new
(4) In comparison with
performance
had little impact on
components such as
standard carpet backing,
improvement. Thanks
the innovative phases
thermoplastic polyolen
EcoWorx constitutes
to the hot-melt
of the development of
compounds with
a re-design as it is a 100%
extrusion technology it
EcoWorx, the design
a breglass reinforcing
PVC-free and 100%
is 100% recyclable into
changes and building
layer.
recyclable.
new EcoWorx.
up the reverse
logistics system.

Automated vacuum
system for waste
collection
(3) Vacuum systems
radically change the way
the waste is sorted and
collected, hence, they
also provide partial
solutions to sorting,
reusing and recycling
waste.

(4) New patented

components enable the
development of the
vacuum system.

(5) The vacuum waste

collection system is
a radically new
approach in waste
collection compared to
conventional systems.

(4) Some key new

components are required
with respect to
conventional cars.
Combination of
conventional and electric
parts.

(3) It changes some

aspects regarding the
(5) Signicant energy
way mobility is
efciency gains are
provided, but it is only
achieved, especially in
a partial solution to
urban trafc
radical system change in
conditions.
transport (drop-in
innovation).

(2) Legislation and

industrial initiatives have
supported the
implementation of
a reverse logistics system.
Government and industry
awards have promoted the
adoption of EcoWorx.
Including environmental
issues in Shaw's corporate
strategy.

(3) The system has

been developed
through active
piloting in the
municipalities to
offer a radically
different system of
waste collection.

(5) It builds on
radically
different
(3) It requires
technologies,
(3) Households and
a different way of
expertise and
industrial users have to
organising the
partners
change the way they sort sorting and
throughout the
and dispose of waste.
collection of
value chain
waste.
compared to
conventional
waste collection.

(2) Requires some changes

in the waste management
practices of clients. Local
governments often play
a decisive role in demand
articulation, authorisations
and nancing.

(1) The system has

been developed by
Toyota through a very
ambitious R&D plan.
Limited role of users
in its initial
development and
greater in later
versions.

(3) Some changes are

required by users (driving
behaviour), but some
benets are privately
appropriated (lower
energy consumption).
Other aspects represent
a continuation of current
mobility and driving
patterns.

(4) The adoption of public

policies are required. No
evidence of technological
cooperation between
different actors.

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

F. Change in
product service
deliverable

Hybrid Synergy Drive

(1) No changes in
the product
service delivered
and in the
perception of the
customer relation.

(2) Some changes

regarding the
value chain
(battery
provision and
maintenance
services).

1079

(continued on next page)

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

(1) Customer
loyalty attained
with the system,
although there is
no change
regarding the
value chain.
(2) It does not
involve major
changes in the
product service
delivered and does
not change the
perception of the
customer relation.
Green Hotel Project

Case

Table 1 (continued )

A. Design of component B. Design of sub-system C. Design of system

addition
change
change

(3) Installation of
a computer management
(1) Marginal changes in (1) No change in the
system tool applied to
the sub-system.
system.
rationalise energy
consumption.

(1) No development
of the eco-innovation
by the user, although
close user/supplier
cooperation to adapt
it to the user
company.

D. User development E. User acceptance

(2) The drop-in nature

of the eco-innovation
facilitates user
acceptance.

G. Change in
product service
process
F. Change in
product service
deliverable

H. Governance change

(2) No major public

governance aspect
involved. Concerning
private governance, no
major changes at the level
of corporate strategy or
internal organisation of NH
were required.

1080

Our unit of analysis is the eco-innovation phenomenon. Information sources include internal company reports, company
proles, product catalogues and eld notes. We have analyzed ecoinnovations from different countries (Japan, USA, Sweden, Spain)
and sectors (Construction, Industrial processes, Resources
management, Transport, Services), in order to observe the
phenomenon of eco-innovation in all its complexity and diversity,
as suggested by the methodology (Eisenhardt and Graebner, 2007;
Ellinger et al., 2005).15 Furthermore, those eco-innovations show
different maturity levels and degrees of disruption (incremental
versus radical eco-innovation), have faced several barriers to their
development/adoption and are affected by different policies. The
cases were chosen to describe the diversity of eco-innovations
rather than as examples of best practice.
3.1. Case 1. Ecocement (construction, Japan)
Ecocement was developed in 1999 by Taiheiyo Cement Corporation, one of the leading Japanese companies in the cement
industry today, as a result of a National Project on behalf of the
Ministry of International Trade and Industry (MITI). Ecocement is
a type of hydraulic cement produced from municipal waste incineration ashes. Thereby, it provides a double environmental benet:
a reduction in the extraction of resources and in the amount of
wastes which reach the environment. Ecocement was recognized
as making an effective contribution to using and recycling
resources and, in 2005, received both the Global 100 Eco-Tech
Award at Expo 2005 Aichi Japan and the MITI Minister's Award. It
is also attracting attention outside Japan.
3.2. Case 2. EcoWorx, carpet backing (industrial processes, USA)
EcoWorx carpet backing technology was introduced in 1999 by
Shaw Commercial as a replacement for traditional carpet tile
backing made from PVC. With over 500 million square feet in use
around the world, EcoWorx is a high-performance backing. In
comparison with standard carpet backing, it constitutes a re-design
as it is 100 per cent PVC-free and 100 per cent recyclable.
3.3. Case 3. Automated vacuum system for waste collection
(resources management, Sweden)
The automated vacuum collection system transports waste at
high speeds through an underground network of pipes to a centrally located waste transfer station where it is compacted, sealed in
containers and then carted away. The system is based on pneumaticsm, i.e, the use of pressurised gas to do the desired work.
Resources can be collected several drop-off points in single buildings, restaurants and shopping complexes. The leader in its development was the Swedish company Envac Centralsug, which
developed its rst pilot projects in the 1960s. Thanks to ongoing
research and development, Envac Centralsug has received several
patents that have enabled it to achieve a leading position in the
market.
3.4. Case 4. Hybrid synergy drive (Transport, Japan)
Toyota Prius is the market leader in hybrid vehicles. Toyota
patented the Hybrid Synergy Drive system and introduced the Prius
in 1997 in Japan, with improved versions in 2000 and 2004. The
Prius combines a petrol engine and an electric motor, depending on

15
A more detailed description of each case can be found in Carrillo-Hermosilla
et al. (2009).

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

the driving conditions. Under urban trafc conditions, only the

electric motor drives the vehicle. When the vehicle is on the
motorway, the petrol engine powers the vehicle and charges
the battery. Therefore, environmental improvements stem from
regenerative braking and from shutting off the internal combustion
engine when the car is stopped. Toyota's strategy is to sell one
million Prius units by 2010, up from 281,265 in 2007.

3.5. Case 5. Green Hotel Project (Services, Spain)

The NH Green Hotel Project, developed in partnership with
Siemens, arose in 2008 to enhance the rational use of energy
sources. The system consists of customising the NH key cards for
guests' entry into the hotel rooms. Guests would mark their preferences regarding lighting and temperature when they checked-in
and the room would be lit and heated to their tastes. In addition to
saving energy, NH managers believed that this system was a further
step in the customised service they provided to their clients. It
differentiates NH from its competitors.

4. Discussion
The main ndings and implications obtained from the analysis
of these case studies with respect to the dimensions of ecoinnovation are discussed in this section and summarised in Table
1. Scores are also provided to reect the level of radicalism of
the change in the considered dimensions.
The design dimension highlights the existing diversity of both
product and process eco-innovations, from incremental, drop-in
innovations to systemic changes.16 All these eco-innovations
contribute to environmental protection, although in different
ways and different time frames. Those eco-innovations scoring
highly in the design of component addition but low in the design of
system change can be expected to optimize existing process,
leading to efciency improvements and costs reductions while
simultaneously reducing harmful impacts on the environment. This
is particularly the case of the Green Hotel project, in which a new
computer tool optimizes the energy consumption of the existing
system. A similar case, leading to greater changes in the subsystem
but still without a substantial system change is Ecocement, which
reduces inputs and energy costs.
As the eco-innovation scores highly in the design of system
change, it has the potential to create new alternatives, which is
crucial in reshaping existing systems and managing sustainability
transitions. The case of EcoWorx, which represents a redesign of an
existing product (i.e., a new product) is the most illustrative in this
regard.
The ecoinnovation case studies suggests that diversity characterises eco-innovation. Diversity might play a major role on the
transition towards a more sustainable economy, i.e., we need ecoinnovations which develop and diffuse on different timescales.
Component additions and sub-system changes are likely to have
direct, short-term impacts on environmental performance.
However, it may be just as important to consider how ecoinnovations contribute to the transformation of the system they
are part of, i.e., redirecting existing systems towards more
sustainable paths. as in the contribution of the hybrid synergy drive
and the EcoWorks backing to the greening of the transport system
or the carpet industry, respectively. In the case of Prius, it improves

16
Drop-in refers to innovations which can easily be embedded in existing
production processes and require few changes in the selection environment (Kemp,
1994).

1081

fuel efciency but may also facilitate the introduction of electric

vehicles.
Therefore, while some low hanging fruits can easily be
adopted now, other eco-innovations require considerable joint
efforts at the development and pre-commercialisation stages. The
former allows us to gain time for the later. Thus, dual approaches in
both policy and management are worth exploring to ensure
incremental performance and environmental improvements in the
short term, as well as more systemic and radical changes in the
longer term. This calls for a sensible balance between standardisation (which allows cost reductions through economies of
scale) and the maintenance of a certain degree of diversity, which
can be expensive in the short-term, but cost-effective from
a longer-term perspective.
Addressing user perspectives brings eco-innovations closer to
the markets and, particularly, to lead users. User-led eco-innovations and eco-innovations with greater market focus have a better
chance of success in the market place, as illustrated in Ecocement,
where the main Japanese cement manufacturer has taken an active
and key role in its development. However, this has not led to
a signicant substitution of dominant technology (Portland cement
manufacturing). Regarding the Green Hotel Project, the user (NH)
has not been involved in the development of the eco-innovation,
but it has collaborated with the supplier (Siemens) to adapt it to
the company. This close supplier-user relationship is shared by
many successful eco-innovations (Del Ro, 2005). In contrast, the
cases of EcoWorx, the automated vacuum system for waste
collection and the Prius all show a rather limited role of users in the
development of the eco-innovation.
On the other hand, a greater market acceptance of ecoinnovations is critical for their success. Thus, in order to facilitate
the penetration of eco-innovations, it is important to create links
and positive trade-offs between the environmental protection
attribute of eco-innovations and other critical factors of competitive products and services such as style, design, price and performance, to be gauged from the customer and market assessment
studies. For example, the perception that EcoWorx performs well in
terms of its environmental impacts but also of its functionality and
quality has facilitated its fast uptake in the commercial building
industry. The 1997 Prius had appearance problems,17 which were
corrected in later designs. Technological improvements by Toyota
were the result of R&D efforts trying to adapt to the preferences of
users, as the company learned from consumer feedback. Our
research suggests that, if the eco-innovations can easily be
embedded in existing lifestyles routines and production processes
(i.e., drop-in regarding user needs), user acceptance is easier to
obtain, as in the Green Hotel project and the Prius, which combine
elements of drop-in with the possibility to privately appropriate the
benets of the eco-innovation. Yet, this does not always occur
because the eco-innovation may require changes in habits and user
routines without signicant private benets to be appropriated by
users, as in the automated vacuum system for waste collection,
where households and industrial users have to change the way they
sort and dispose of waste.
Regarding the product service dimensions, eco-innovations may
offer opportunities for the renewal of business concepts. The
paramount example is EcoWorx, which led to the creation of a new
product, the redesign of the product value chain and the building
up of the reverse logistic system, involving radical changes in its
product-service deliverable. The vacuum system provides another
example. It requires a different way of organising the sorting and

17
looking oddly stretched and tubular, as if the innovation in the engineering
needs to nd some expression in the bodywork (The Guardian, 2004).

1082

J. Carrillo-Hermosilla et al. / Journal of Cleaner Production 18 (2010) 1073e1083

collection of waste, which improves the local environment by

reducing noise, odours and visual pollution. It builds on radically
different technologies, expertise and partners throughout the value
chain compared to conventional waste collection. In contrast, the
other three cases do not involve signicant changes in the productservice delivered and in the perception of the customer relation.
The governance of eco-innovation can benet from the high
status recently given to innovation in both policy and business. All
the case studies highlight the important role of public policy
makers in the development/uptake of eco-innovations. This can
take different forms: a more direct involvement in the development of the technology (Ecocement), provision of a supportive
policy framework (EcoWorx and Hybrid Sinergy Drive) and/or
a decisive role in demand articulation (vacuum system). The only
exception is the Green Hotel project, with no major public governance aspect being apparent. Furthermore, successful ecoinnovations are highly dependent on the participation of different
stakeholders in their development/uptake, i.e., they are likely to
result from the cooperation among different units and the formation of partnerships between the public sector, academia and
business. The role of public policy makers as facilitators of this
multi-agent collaboration might be highly relevant. Ecocement
clearly illustrates this point: its development involved intensive
collaboration between the private and public sectors and
substantial consultation of other stakeholders.
5. Conclusion
This paper has identied the key dimensions of eco-innovation
(design, user, product service and governance). An analytical
framework has been developed to explore these key dimensions,
identify the specic characteristics of different eco-innovations and
analyse their variety. This framework has been used to analyse a set
of detailed case studies of eco-innovation.
It has been found out that eco-innovations usually involve
a combination of elements pertaining to several dimensions. Albeit
the design dimension is decisive to determine the environmental
impacts of the innovation, the other dimensions also play a significant role in the market introduction of eco-innovations. Ultimately, the capacity of eco-innovations to provide new business
opportunities and contribute to a transformation towards
a sustainable society depends on the interplay of those dimensions
and the engagement of key stakeholders in the innovation process.
It should be noted that the suggested assessment of changes
occurring in the eco-innovation process is subjective, not only
because of incomplete information but also because of interpretations and the use of the graded scale of changes. Furthermore,
albeit the method can be applied to different eco-innovation types,
as shown in the empirical part of this paper, it may not be applicable to all eco-innovations.
Acknowledgements
We are grateful to two anonymous referees for their useful
comments. The usual disclaimer applies.
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